Martha May is the CEO of Grinch's Whoville Corporation (GWC). The company manufactures two electric shavers, the basis and the deluxe. She has just received the latest industry statistics, which indicate that industry sales for electric shavers were 5% higher than the company had forecast when developing this year's budget. The industry numbers were a pleasant surprise for Martha. \"If we maintain our market share, then I suspect we will have had a good year, surpassing our expectations. " GWC anticipated combined sales volume of 00,000 units. for the basic electric shaver and the deluxe electric shaver, when it developed the current year budget. The basic electric shaver had typically accounted for ?0% of the company's sales in the past and Martha had used that percentage in calculating the current year's budget, although she was hopeful that the deluxe electric shaver's proportion would grow. In the budget, the basic electric shaver had a unit selling price of $110.00. Variable manufacturing costs were budgeted at $65.00 per unit. The only variable operating cost was a commission of 3% of the unit selling price that was paid to the sales representatives. The deluxe electric shaver included some premium features that allowed the company to sell the unit for $145.00. The variable manufacturing costs were 20% higher than the basic electric shaver and the sales commission remained at 3% of the unit selling price. The market for the basic electric shaver fumed out to be very competitive. The sales manager lowered the unit selling price so that the average selling price for the year was $105.00. Revenue for the basic electric shaver totaled $4,200,000. Variable manufacturing costs were slightly higher than expected and averaged $63.00 per unit. To stimulate sales of the deluxe electric shaver, GWC dropped the selling price by $10.00 per unit. The price decline resulted in a 15% increase in sales volume over the budget. Variable manufacturing costs remained close to budget throughout the entire year. GWC is now nalizing the nancial statements for the year. Based upon the information presented above, Martha has asked you to prepare an analysis of GWC's profitability for the year. In addition to the information already provided, Martha mentioned that xed manufacturing overhead costs of $700,000 were $45,000 less than anticipated in the budget. Fixed operating expenses of $350000 were exactly on budget. The company does not allocate fixed costs between products as any allocation would be meaningless. Anticipated industry volume was 440,000 units per year. Required: 1. What was the budgeted operating income for the current year? [4 marks} 2. What was the actual operating income for the current year? [3 marks} 3. Prepare a variance analysis from the information provide by calculating the following variances: Flexible budget variance for both products. [2 marks] Sales volume variance for both products. (2 marks) Sales quantity variance for both products. [2 marks] d. Mix variance for both products. [2 marks} 4. Calculate the market size and market share variance for the electric shavers. [4 marks} 5. Did the company realize any of the expectations mentioned by the CEO? Explain. [4 marks) or!\